Blair to heat up Europe debate

TONY BLAIR will this week try to scotch rumours that the Government is cooling towards the single currency with a staunchly pro-European speech emphasising the importance of Britain's place in the EU, writes Rachel Sylvester.

The Prime Minister feels so passionately about the issue that he has taken the unusual decision to write his speech entirely by himself this weekend, and has not even asked his advisers to produce a draft.

He will argue that being part of Europe is "vital" to Britain's future prosperity and that the United Kingdom will lose out if it does not remain fully engaged in Brussels politics. Although aides say that the speech, to the London Business School on Tuesday, will not change Government policy, it will represent a significant shift in emphasis.

The Prime Minister, urged on by Peter Mandelson, has decided he must take a more aggressive approach to confront the growing public scepticism towards Europe head on.

According to friends, he has come to the conclusion that the basic arguments for Britain's involvement in Europe must be reiterated before the Government can even begin to think about persuading people that it is right to join the single currency.

This follows warnings from focus groups that public opinion is hardening against the euro and that there would be "massive risks" for the Government in showing unambiguous support for joining. "We have to win the battle from first principles," one senior Downing Street source said. "They don't like Europe and we have to make the case that it is in our national interest to be positive, strong and engaged in Europe."

Mr Blair's speech follows speculation last week that the Government was unlikely to hold a referendum on British entry into the single currency in the next Parliament. There is a row going on in Whitehall about how positive the Government's Europe policy should be.

The Chancellor Gordon Brown is concerned that the other European economies are too weak to make it in Britain's interest to join in the near future. However, Robin Cook, the Foreign Secretary, is worried that the UK would lose its influence in Europe if it ruled out signing up to the euro.